And "Let Me Start" with simple, undeniable facts. The president of the
United States has the right and duty to select the secretary of state, the
person he thinks will best help him shape and project this country`s
foreign policy. Just as important, the Senate has the duty to advise and
consent to his decision. If senators see a serious problem with a nominee,
they have the right and duty to speak and vote that way.

Someone keeps telling the press that President Obama prefers to nominate
U.N. ambassador Susan Rice, and as long as that person is not the president
and does so under ground rules that protect his or her identity, we are
condemned to this preventive war we`re watching in Washington, one side
attacking while no one outside the gates of the White House knows what the
president intends.

I take President Obama at his official word. He has not decided whose name
to send to the Senate.

And with that, we go to the first of our two senatorial guests. Senator
Bob Corker, Republican of Tennessee. Senator Corker, I`ve laid it out as
best I can. You senators have a right and a duty to decide, to advise and
consent or not, to a president`s nominee.

Isn`t this strange that we`re having this debate about the qualifications
of a candidate for the secretary of state position, and she hasn`t been
nominated?

SEN. BOB CORKER (R), TENNESSEE: I think it is. And it`s -- you know, as I
mentioned yesterday, whoever the president does nominate, I certainly look
forward to giving a full hearing. I don`t actually know how this has, you
know, gotten this way. I did have a long meeting yesterday, though, with
the -- with the ambassador.

And I mean, you would have to say that there`s a lot of indications that at
least there`s some balloon floating that`s taking place, and I don`t
think...

MATTHEWS: Yes, there is.

CORKER: I don`t think otherwise, she would have spent an hour-and-a-half
with me yesterday and an hour and 15 minutes with Susan Collins and others.

So I mean, you`re right, she`s not nominated, but it does appear
something`s happening to just sort of gauge support, so...

MATTHEWS: Let me show you a piece of what the ambassador to the United
Nations, Susan Rice, said on "MEET THE PRESS" on September 16th, five days
after the attack on our facility in Benghazi. I think it`s the heart of
the critique that people are making of her. I hope I`ve got it. You`ll
tell if I`m right.

Let`s listen.

CORKER: OK.

(BEGIN VIDEO CLIP)

SUSAN RICE, U.S. AMBASSADOR TO THE UNITED NATIONS: Putting together the
best information that we have available to us today, our current assessment
is that what happened in Benghazi was, in fact, initially a spontaneous
reaction to what had just transpired hours before in Cairo, almost a
copycat of the demonstrations against our facility in Cairo, which were
prompted, of course, by the video.

What we think then transpired in Benghazi is that opportunistic extremist
elements came to the consulate as this was unfolding.

MATTHEWS: So there you have it. What do you think about that? And what
role does that statement by her make in the concern about her
qualifications?

CORKER: Yes. You know, Chris, one of the things that`s amplified some of
the concerns around this is we had a classified briefing with about 65 or
70 senators on September the 20th, and I assure you if you were there, you
would have thought it was most of the one bizarre briefings ever, where we
had four, you know, distinguished people there who shared, like, no
information.

I was in Libya about a week after that. It was a pre-planned trip. I
didn`t go there because of Benghazi. Obviously, Benghazi was a big topic.
And I sat there with our station chief, our head intelligence person, with
the charge who was there serving after the ambassador had been killed. And
they were telling me that in real time, they were letting folks back home
know that this, in fact, was a terrorist attack and there was absolutely no
protest.

So you can see how people have had concerns. I think, really, and in
talking to Ambassador Rice yesterday -- we had a very long meeting -- you
know, one of the things that she knows she shouldn`t have said was that we
have decimated al Qaeda. And I know that you know this because you`re a
student of what`s happening in the world, but certainly, nothing can be
further from the truth.

So I do think there have been some fairly legitimate concerns that -- that
this was all in the height of a political campaign, and it really did
appear that she was very anxious to make it appear that things were a
little different in the Middle East than they are.

Look, we can all get caught up in that, and certainly, we had a
conversation to that effect yesterday, but I will tell you, as a person --
I think you asked me to come on because I hope you think I`m fairly level-
headed. I`m really disgusted with everything from the intelligence to the
security to, you know, the FBI to -- I mean, this whole thing really should
not be where it is today. And I do think that part of it is she`s gotten
caught up in some of the other things that -- although I have concerns and
you`ve heard my concerns that I do...

MATTHEWS: You`re concerned that she said it was a spontaneous uprising by,
as we`ve seen in Karachi and as we saw in Cairo on that day -- It was just
part of the general outrage of the Islamic world against the video that
came out of Los Angeles. And you say it definitely wasn`t and the people
at the time knew it wasn`t.

CORKER: Right. Well, actually, Chris, I don`t even want to get into those
-- those -- it`s actually beyond that. I like Susan Rice. She knows I
like her. We`ve had a warm relationship.

I think that she strikes me sometimes as more of a political operative...

MATTHEWS: Right.

CORKER: ... than somebody who is -- you know, the secretary of state, we
hold to a very different standard. We do that with the secretary of
treasury, sometimes the secretary of defense. They`re sort of first among
equals of other cabinet members, and I think that most of us want to see a
degree of independence.

I want you to say -- I want you to know I`m not disqualifying her, OK? I`m
telling you that, certainly, if she is nominated, I am going to give her a
full hearing. I always do that...

MATTHEWS: You don`t see her as a principal. You see her as an ally or an
associate the president, rather than as a principal separate from him. Is
that the way you`re trying to say it?

CORKER: Well, Chris, in all the conversations that I`ve had with her, you
always feel it`s sort of pushing a political point of view.

MATTHEWS: I see.

CORKER: When I have those same conversations with Secretary Clinton, I
feel -- she`s always supportive, obviously, of the president`s agenda, but
you -- it`s a different sense of transparency and directness and pointing
out, you know, things we need to be thinking about.

And I`m not saying that Ambassador Rice in that position couldn`t end up
being that way, but initially, my sense of her is -- and we had this very
direct conversation yesterday for about 30 minutes -- is I do -- I`ve
always sensed her to be more of a political operative.

I know she`s steeped in policy and has spent lots of time in Africa, and I
don`t take that away from her. But I do have some concerns. Again...

MATTHEWS: OK.

CORKER: ... if she`s nominated, I`m going to give her a full hearing, and
I promise you it will be a fair full hearing.

MATTHEWS: Well, I take you at your word, Senator. It`s great for you to
come on. It`s a very clear point of view you`ve given us tonight. Thank
you for joining us on HARDBALL.

Yesterday, I spoke with Senator Susan Collins, who also said she had
concerns about Ambassador Rice. Let`s listen to that interview.

SEN. SUSAN COLLINS (R), MAINE: It`s obvious that she chose to emphasize
some aspects and downplay others. And frankly, I think the U.N.
ambassador, along with the secretary of state, should be above politics and
that she should have just said, No, I`m not going to go on those shows.
It`s the wrong issue and the wrong time of year. I`ve got to maintain my
credibility.

(END VIDEO CLIP)

MATTHEWS: OK. Joining us right now for another point of view is Kent
Conrad. He`s Democratic senator from North Dakota. Senator, I guess
you`ve heard those views. What are your views about the issues they`ve
raised on the antagonistic side?

SEN. KENT CONRAD (D), NORTH DAKOTA: Well, first of all, I have high regard
for Senator Corker and Senator Collins, but there are others who have been,
I think, strident voices against the ambassador that have been terribly
unfair to her.

What she said on those Sunday talk shows was precisely what the
intelligence community agreed to unanimously would be the unclassified
version of events. It is entirely appropriate for the ambassador to rely
on the intelligence community for what she says in public. What was said
in a classified report would have been totally inappropriate for her to
talk about on those Sunday talk shows.

So she is being pilloried and criticized for doing precisely what she
should have done, which was to use the intelligence community`s
unclassified assessment of what occurred.

MATTHEWS: Well, they make the point -- and I`ve listened to all the
complaints about her, the more dignified and the less dignified ones. And
their argument seems to be that she went on as a flack, if you will, a
press secretary, somebody who went on to basically spin it so the president
would look good, that his arguments over the last several months of the
campaign would look good, that we`ve basically decimated al Qaeda, that it
wasn`t a terrorist -- organized terrorist attack, it was a spontaneous
attack.

And they say she emphasized more the spontaneity of it and the relationship
to that video coming out of Los Angeles and de-emphasized the role of
organized terrorism here.

Is that a fair criticism, or is that something that comes with the
territory of speaking for the White House?

CONRAD: I don`t think it`s fair. Look, I`m on the Intelligence Committee,
and there`s a lot that we can`t talk about that goes on there.

But what is very clear is the intelligence community has said with great
clarity and with unanimity that the talking points she used were the
talking points provided to her by the intelligence community of the United
States, that they provided those talking points after consultation with all
of the agencies, and they were the unclassified talking points, which is
precisely what any ambassador...

MATTHEWS: OK.

CONRAD: ... any representative of the United States should use, not the
classified talking points that might reveal things critically important to
national security.

MATTHEWS: Two questions. Can you tell us without giving away the names of
the people involved, is there a personal vendetta at work here from some of
the senators, a personal vendetta against the person of the U.N. ambassador
here, Susan Rice? And/or is there a surrogate attack going on against the
president who`s just been reelected by people who are embittered by that
fact?

CONRAD: I think it`s people who are embittered by the reelection of the
president, and I think she`s caught in the crossfire, and I think she`s
caught in it in a completely unfair way.

Again, she used the talking points provided to her, and not just to her.
Those were the talking points that were prepared by a request from the
House Intelligence Committee. That`s who the intelligence community was
responding to.

MATTHEWS: Oh.

CONRAD: She got a copy of those comments, and those are the ones she used,
which was entirely appropriate for her to do.

MATTHEWS: We`ll have to have you back, Senator, to talk about something I
know you`re good on, that`s the fiscal cliff. I want to have you on
because I trust in you, sir. Thank you, Kent Conrad...

Coming up, hot new evidence the Republicans have learned nada, nothing,
from the election they just lost. Yesterday, you saw the all-white
Republican chairmanships in the House of Representatives. Well, today`s
story -- you won`t believe this -- the marquee name for the Republican
Party next year is the likely nominee of the Republican Party for governor
of Virginia, a guy named Ken Cuccinelli, a real winger. Wait until you
catch his decisions on all kinds of issues affecting women, immigrants,
everybody. This is the full Monty of the right wing coming up in this
marquee election for governor of Virginia.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: Well, you can add another victory for the Democrats in the
congressional races. In the House of Representatives in North Carolina`s
7th district, Republican David Rouzer has conceded to incumbent Democratic
congressman Mike McIntyre.

And that means Democrats have won a net gain of eight seats in the House
elections this year, and they`re already strategizing on how to win the
next net 17 they need to take over in the 2014 mid-terms, although it must
be said it`s very hard for the party controlling the White House to win
either body over in that mid-term election.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. It appears Republicans have learned
few, if any, lessons from the election they just had. And as we said last
night, a party that lost overwhelmingly among women, Latinos and African-
Americans will have House chairmen that all look like -- well, they look
like those guys.

Now the chief strategist of Romney`s campaign, Stu Stevens, is describing
why he lost. He wrote in "The Washington Post" today, quote, "There was a
time not so long ago when the problems of the Democratic Party revolved
around being too liberal and too dependent on minorities. Obama turned
those problems into advantages and rode that strategy to victory."

"But he was a charismatic African-American president with a billion
dollars, no primary and media that often felt morally conflicted about
being critical. How easy is that to replicate? In other words, the
election was an anomaly" -- according to Stu Stevens -- "giving Republicans
little reason to worry in the future. "

This morning, Stevens said Mitt Romney`s ideas were right on, as he puts
it. Well, he`s getting cool, he`s "right on" in his talking. Let`s
listen.

STU STEVENS, FMR. ROMNEY CAMPAIGN CHIEF STRATEGIST: I think that the ideas
carried the day for us, and that success that we had, though it obviously
wasn`t enough to win the race, was based on the candidate Mitt Romney and
on his ideas.

(END VIDEO CLIP)

MATTHEWS: Well, using that `60s language of "right on," he isn`t quite.
He continued the outreach was the campaign`s problem, not necessarily the
message. Let`s listen here.

(BEGIN VIDEO CLIP)

STUART: I think we should have done a better job reaching out to women
voters. The governor has a great record on women`s issues. We should have
done a better job articulating that record. And we should have done a
better job reaching out to Hispanic voters. We should have done it earlier
and in a more effective way.

(END VIDEO CLIP)

MATTHEWS: Well, Michael Steele is former chair of the Republican National
Committee back in the days they won elections like this, and Howard Fineman
is editorial director of the HuffingtonPost. Both are MSNBC political
analysts.

You know what the British imperialists used to do when somebody who speaks
another language couldn`t understand them? They yelled louder.

MATTHEWS: And then the guy (INAUDIBLE) or someone said, I still don`t
understand you. You can keep yelling in your British...

(CROSSTALK)

MATTHEWS: ... so that here`s a theory that it`s a failure to communicate.
Your thoughts.

MICHAEL STEELE, FMR. RNC CHAIR, MSNBC POLITICAL ANALYST: That`s just the
tip of the iceberg there. Yes, it was a failure to communicate. I mean,
you can sit back now and say, well, we woulda, shoulda, coulda, but along
the way, guys like Howard, you, myself within the party were saying, This
is what you should be doing. You need to communicate better...

MATTHEWS: But I`m not with your party.

STEELE: No, but I`m just saying -- but no, there were moments where you
were slightly objective in this process and in which you were...

(CROSSTALK)

MATTHEWS: What a sweetheart!

STEELE: ... where you were very clear, and I think all of us were clear
that there were communication gaps. But it was more than that, Chris. And
I think it was organization. It was ground game. It was a network...

MATTHEWS: This immigration thing is new to a lot of us. It`s a big
development in this country. A lot of people are undocumented. Lots of
people, mostly from Latin America, not all certainly, and they believed
that their interests lay with the Democratic candidate this time, the
president. For what reason?

FINEMAN: ... means or should mean talking to them about -- the voters
about issues they care about in the ways that they find appealing.

And what Mitt Romney`s problem was, say, with the Hispanic community, was,
especially in the primaries, Mitt Romney came on as the hard-core guy who
wanted people to self-deport or get gone.

The way that sounded to -- evidently, it sounded to 71 percent of Hispanic
voters who supported Barack Obama was, We don`t want to hear the Republican
candidate whose main platform is about getting us to take ourselves and
leave the country. That`s the reaching out that was wrong --

STEELE: Right.

FINEMAN: -- not the mechanics, not the ground game, not that they didn`t
advertise on Hispanic radio, which they didn`t do in the first six months
or television. Those are just mechanical things. It`s a matter of
substance.

(CROSSTALK)

MATTHEWS: And the last president proved it. Your last Republican
president, the last president who was Republican, was very good on Hispanic
issues, because he went out and tried a little Spanish. He obviously had a
good fellowship there. And he had an openness.

(CROSSTALK)

FINEMAN: If you had more time to talk to Stuart Stevens and have an
argument with him, or a discussion with him, I think he`d agree with that.

MATTHEWS: OK. Let`s take a look at this, what is going on.

Already, here we are in the Potomac River right here in Washington right
between Virginia and Maryland. And we got the biggest race because it`s in
the odd thing. That`s why we always talk about Virginia and New Jersey.
Chris Christie is up for reelection. It`s going to be the governor`s race
up there which will almost certainly pit the state`s far-right attorney
general, Ken Cuccinelli there, against former Democratic National Committee
chair Terry McAuliffe, a real Clinton guy.

Well, the race could set the template for Republican candidates in 2014 and
beyond. Of course those candidates will watch to see how an extreme
candidate like Cuccinelli, who is a very conservative guy, does in
Virginia, a state that votes most like the rest of the country and has now
twice voted for Barack Obama.

How extreme is Cuccinelli? He supports personhood. That means from the
moment after conception, the fetus or unborn child has the rights of life,
liberty, and property and that gets serious business there. His own Web
site uses the kind of harsh language on immigration that turned off Latino
voters in the election -- quote -- "Ken is committed to solutions that
remove the economic incentives that encourage illegal immigration. Illegal
aliens who choose to break additional laws by stealing identities, dealing
drugs, joining criminal gangs, driving without a license, or committing
fraud must receive prompt justice and deportation, no ifs, ands, or buts."

I would say that was clear. He also -- he altered the Virginia state seal
for modesty, by the way. Notice that woman was a little more French
perhaps than her display or whatever, but he says he wanted to make sure
that bare breast was removed from the Goddess of Virtue, anyway, small
point.

When Cuccinelli had lapel pins made the state seal, the goddess` breast was
covered, so small point. He discussed concerns about getting a Social
Security number for a soon-to-be-born child of his. He was wondering
whether he should the child get a Social Security number or not because of
concerns about black helicopters. Here it goes. Let`s listen.

(BEGIN VIDEO CLIP)

KENNETH CUCCINELLI (R), VIRGINIA ATTORNEY GENERAL: We`re going to have our
seventh child on Monday, if he`s not born before.

And for the very concerns you state, we`re actually considering, and as I`m
sure many of you here didn`t get a Social Security number when you were
born, yes, to do it now. We`re considering not doing that.

And a lot of people are considering that now because it is being used to
track you.

(END VIDEO CLIP)

MATTHEWS: This is crazy. This is the kind of black helicopter. The
government, they`re coming to get you in your house. They get your number.
We`re going to register all the guns. We`re going to come get -- who is he
appealing to in Virginia there in your party?

STEELE: Well, there is clearly in the southern and the western portions of
Virginia, certainly not Northern Virginia, you know, some of that rhetoric
may have some appeal. What is going to be interesting...

STEELE: He`s running -- this is my point, Chris. This is going to be very
interesting to see how -- because I campaigned with and for Cuccinelli when
he ran before in 2009, and he and the lieutenant governor, Bolling, both
very good men. And it`s going to be very interesting sort of...

(CROSSTALK)

MATTHEWS: A hell of a race.

STEELE: Yes, it`s going to be a hell of a race, that primary -- because
remember the primary is a convention. And it`s not on open primary. So,
you are going to have a great push by conservatives, you are going to have
a great push by other Republicans in the party between Bolling and...

(CROSSTALK)

MATTHEWS: You got another Ollie North on your hands there.

FINEMAN: Lieutenant Governor Bolling has basically said I`m out of here.
He`s not going to take part in this process. He`s even talking ultimately
about running as an independent.

MATTHEWS: Project it nationally. What does this say about the national
Republican Party?

FINEMAN: I think this is a laboratory experiment to see if the Tea Party,
if the right-to-lifers, if the radical anti-government people, if the
Grover Norquist wing of anti-taxers can win an election or not. And
Virginia is a great test, because it`s now a swing state that they should,
Republicans should be able to win with the right kind of message.

They didn`t win it. A -- quote -- "liberal" won it, according to Stuart
Stevens. What does that tell you? Can the real hard-core right wing win a
statewide election with a guy like Cuccinelli?

And they may be up against Terry McAuliffe, the Democrat who represents
everything about the Clinton/Obama Democratic Party that the people in
Southside Virginia can`t stand, that they don`t like. Let`s see what
happens.

MATTHEWS: Well, he`s a classic Northern Virginia guy.

(CROSSTALK)

MATTHEWS: ... so he can work in Washington. He`s a bedroom community guy,
which is fair enough, but they don`t like it.

STEELE: But they don`t like it.

And I think Howard is exactly right. This is going to be a real dynamic
test for the GOP on the national level, not just for Virginia, but how a
message translates across the country.

MATTHEWS: Guess who else is going to be in there for his wife perhaps?
Bill Clinton will be in there campaigning.

Up next: Remember that guy who got the Romney campaign logo tattooed on
his face? Well, he`s having a bad case of buyer`s remorse. Do you believe
it? He`s thinking about giving back Romney. And that`s ahead.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Back to HARDBALL. Now to the "Sideshow."

Vice President Joe Biden made a surprise visit at the grand opening of
Washington, D.C.`s new Costco this morning, and he reminds shoppers about
the fiscal cliff while he`s at it.

(BEGIN VIDEO CLIP)

JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: In all honesty, I
didn`t have my own card. Jill wouldn`t let me have one. I went to get my
wife`s card and she said, no, no, no, no, you get your own.

BIDEN: All the people you meet in here today and you see, these are
hardworking folks who don`t need to see their taxes go up.

(END VIDEO CLIP)

MATTHEWS: That`s one way to create opening day buzz, although it looks
like, watching this scene, everybody in the store was more interested in
watching the vice president do his own shopping there.

Also, why are people receiving this fund-raising e-mail from Bill Clinton?
Quote: "I have enjoyed it so much whenever we have brought one of Hillary`s
strongest supporters to New York to spend a day with me. I`m happy to tell
you that I am asked to do it again."

No, this is not the launch of a Hillary Clinton 2016 campaign. The fact
is, Secretary Clinton`s 2008 campaign still owes about $70,000 in their
campaign fund there and they`re trying to pay it off.

Just weeks after gallivanting the country for President Obama, big Bill is
back there working his fan base again, offering donors the chance to spend
time with him.

Next, remember when Georgia Congressman Paul Broun offered this account of
how old the Earth is?

(BEGIN VIDEO CLIP)

REP. PAUL BROUN (R), GEORGIA: You see, there are a lot of scientific data
that I have found out as a scientist that actually show that this is really
a young Earth. I don`t believe that the Earth is but about 9,000 years
old.

Anyway, Broun is not alone. When Florida Senator Marco Rubio was asked
about the age of the planet in a recent interview, he dodged it, saying,
"I`m not a scientist, man."

Well, now televangelist Pat Robertson of all people is weighing in, but not
in the way you might expect. We`re going to have Pat Robertson back.
Anyway, Pat Robertson out saying the Earth is very, very old. We should
believe the artifacts and the paleontology.

Anyway, finally, a real about-face for Eric Hartsburg. He`s the guy who
had the Romney campaign logo tattooed on his face before the election, in
fact, in exchange for a $5,000 payment.

When Romney lost, Hartsburg said he was keeping the tattoo anyway. Then
Hartsburg got caught wind of Romney saying the president won the reelection
by giving gifts to minority voters. Now he says -- quote -- "It stands not
only for a losing campaign, but for a sore loser. There`s no dignity in
blaming somebody else for buying votes and paying off people. I can`t get
behind me -- that or stay behind that."

Well, a tattoo removal chain offered to remove the tattoo for free. And
Hartsburg is taking them up on it. They are predicting it will take seven
to 10 laser removal sessions to get rid of the whole thing. Hartsburg says
he will be more choosy about future political tattoos.

Up next: Republicans know they are stuck now between Grover Norquist`s no
tax pledge and knowing they will be blamed if they go off the fiscal cliff.
Well, that`s ahead.

The Dow gains 36 points, the S&P is up six, the Nasdaq adds 20 points. It
was a rough day for retailers, especially Tiffany. Shares slid 6 percent
following a weaker-than-expected earnings report and disappointing
guidance.

As for the economy, it grew at a 2.7 annual rate in the third quarter, the
fastest pace since late 2011. And jobless claims fell by 23,000 last week,
the second weekly decline since Hurricane Sandy.

That`s it from CNBC, first in business worldwide -- now back to HARDBALL.

MATTHEWS: Back to HARDBALL.

Let`s take making a deal here for all that at home who want to see
Republicans and Democrats work together to avoid the fiscal cliff. We can
bring you two lawmakers now who are open to cutting a deal before the end
of the year.

With me now tonight are members from both sides of the aisle, U.S.
congressman Lee Terry, a Republican from Nebraska, and U.S. Congressman
Gerry Connolly, a Democrat from nearby Southern Virginia.

But, first, Congressman Terry, I want to start with you.

REP. LEE TERRY (R), NEBRASKA: OK.

MATTHEWS: You told "The Omaha World Herald" this about Republicans --
quote -- "We`re screwed either way. We really have no leverage in these
discussions."

Congressman, what did you mean by that?

TERRY: Well, what I mean by that is that the president wants us to take a
tax vote before he`s willing to talk about anything else, cutting or
reforming.

And Republicans just aren`t going to do that. So what he`s doing is
setting us up to be the fall people for going over the fiscal cliff. And,
frankly, going over the fiscal cliff is a win for the president. So either
way, we`re going to get it.

MATTHEWS: But I don`t see why that`s true, because if you -- first of all,
the president has talked around what kind of cuts he wants to do in non-
defense discretionary and almost a third of a trillion dollars over 10
years in entitlements.

He`s talked along those lines. And if he doesn`t give you a definition and
details by the time you go to vote, obviously, you won`t vote for it. So,
what`s your risk? He`s got to get in the pot, too, with his part of the
deal well before the end of the year.

(CROSSTALK)

TERRY: Yes, I think he wins by playing the political games, because we...

(CROSSTALK)

MATTHEWS: What game?

TERRY: ... you have met that -- well, the setting up -- saying that we
have to take a tax vote before he`s even willing to discuss anything else?

(CROSSTALK)

MATTHEWS: Oh, OK. You said he wants to vote on that. OK. You said he
wants to vote on that without the package being prepared.

TERRY: Well, that`s right. He wants us -- he said that the other day,
that he wants us to take that tax vote to prove our sincerity.

Well, I will tell you what. If he comes with a big package that does raise
revenues, a lot of us are going to vote for that if it`s good enough.

MATTHEWS: Well, I disagree with the president. I`m with you on that then.

TERRY: That`s his position, but he`s not discussing that.

MATTHEWS: Look, if he wants a separate vote, I agree with him, but I think
-- I agree with you guys, because I think he has to do some -- let me ask
you. From your point of view, would you agree to -- for high income people
above a quarter million a year? Would you go for a 38 percent marginal
rate? Would you accept something like that as a compromise, with something
perhaps, a higher cap on Medicare payments? Would you accept something
like that?

TERRY: I think those are all part of the discussion here, and we will be
open to a lot of different things as long as we get the big deal on this,
that we make those type of reforms.

MATTHEWS: OK.

TERRY: I would rather see tax reform than just going and saying we`re
going to increase the rate on the top level from...

MATTHEWS: I know you would.

TERRY: ... you know, 35 to 38.

MATTHEWS: But that won`t work, because the liberals will never get in to
deal with you guys unless you raise the rates. I promise you that.

MATTHEWS: They want to see the bite marks on your neck. They want to know
that you guys defending the rich have paid a price before they will pay.

The Pelosi core of the Democratic Party will not deal if the president
doesn`t get a rise in the rates for the rich people.

TERRY: And we feel the same way about them. We don`t trust that they will
have earnest discussions about tax cuts -- I`m sorry -- about real spending
cuts, and so setting up that we have to vote first...

MATTHEWS: OK. Let me bring in Mr. Connolly.

TERRY: ... just isn`t going to work.

MATTHEWS: OK.

I don`t know about this game of who is first here, this Alphonse and Gaston
game here. Somebody is going to have to go first.

TERRY: That`s true.

MATTHEWS: Let me ask you, Mr. Connolly, well, how do you see this react --
how do you react to what he`s saying there, first of all? That makes is
simple.

REP. GERRY CONNOLLY (D), VIRGINIA: Well, I certainly can understand
Congressman Terry`s concern, but I think the election is over.

The president won the election, and there weren`t a lot of explicits in
this campaign, but one that there was, was the president explicitly saying
-- I was at three rallies with him in Virginia -- I think the better off
the higher income tax brackets ought to pay a little bit to help us in this
fiscal cliff. He campaigned and won on that premise. Public opinion
polling subsequently shows the public is with him on that.

CONNOLLY: Let`s get beyond the name calling and try to settle that so that
the 98 percent whose taxes will stay low can stay low.

MATTHEWS: Let me ask you both if you agree on this. The importance of
getting this done before Christmas and not letting this go slinking off
beyond January 1st.

You first, Mr. Terry.

REP. LEE TERRY (R), NEBRASKA: Yes, I want to get this done, and I think
the people want us to get this done. So I don`t want to punt it. I don`t
want to push it into next year. Let`s get the discussions rolling, let`s
get the big deal done. That`s what the people want us to do.

MATTHEWS: Well, I hope you can get your business community behind you
because they`re the unlikely allies of the president here. It`s Tom
Donohue and the U.S. Chamber --

TERRY: They want it done.

(CROSSTALK)

MATTHEWS: I know. But they`ve got to make Republicans vote for a deal
early.

Mr. Connolly, do you think that the liberals will vote for anything unless
they get a rise in the tax for the top people?

CONNOLLY: Well, I -- really, I can only speak for myself, Chris, but my
sense of the caucus is there are strong feelings about protecting
entitlements from depredations on the other side and they want to be very
clear about the details. But I think there`s also a willingness to work
with the president and support the president in his leadership in averting
the fiscal cliff and I agree with Mr. Terry, we want to get this done
before the end of the year so that we`re not roiling markets, we`re not
disrupting people`s planning for the next calendar year, and we`re not
having anybody`s taxes go up in the middle class.

MATTHEWS: Let me get the timing right, Mr. Terry. You`re in the majority.

Are you guys being advised by your whips that there are going to be tough
votes on Christmas Eve, right near Christmas Eve? Or are there going to be
some coming back after Christmas before the 31st in some crazy Christmas
week chaos? In other words, are you being advised that the big votes are
going to come before Christmas?

TERRY: We -- our leadership and our conference has said there hasn`t been
any substantive discussions and so we don`t know when this is going to be
over.

MATTHEWS: Well, that`s not very heartening.

TERRY: No, it isn`t. It`s very frightening as a matter of fact.

MATTHEWS: I`m watching the stock market -- you know what I`m told by my
financial adviser and I trust him completely, Dan Saunders (ph) up there in
New York, he probably loves me mentioning his name. He says that the
market right now which is back to the 13,000, the Dow today, good news, is
based on the confidence that you professionals can put a deal together
before New Year`s.

In other words, it`s all based on that. It`s ice we`re on right now, thin
ice.

Do I understand you guys have to get this done in time and if you don`t,
the markets will be completely screwed up by this worldwide? Your
thoughts?

Who wants to talk about that one? Mr. Connolly?

CONNOLLY: Yes, I`ll be glad to comment on that. I`m a little more
optimistic than my colleague.

I think a deal is sort of cooking. I think the parameters of that deal are
not mysterious. I don`t think this involves rocket science in putting it
together.

It requires political consensus. I think there are a lot of trial balloons
going on on the Republican side of the aisle to try to build that
consensus, and I think once that happens we`re going to get it done.

If we have to be here Christmas week in order to protect the American
public from the fiscal cliff, I`m happy to be here and so are my
colleagues. Whatever it takes --

MATTHEWS: I hope everybody -- I hope everybody speaks Greek because that
would be the appropriate language to use the week after Christmas. Thank
you both.

Get it done before Christmas.

CONNOLLY: Thank you.

MATTHEWS: Thank you, U.S. Congressman Lee Terry, thank you so much for
coming on, sir.

TERRY: Thank you.

MATTHEWS: Thank you, Congressman Connolly.

CONNOLLY: Thank you.

MATTHEWS: Up next, President Obama had Mitt Romney over for lunch at the
White House. Do you believe it? I`d love to know what happened in that
room. It`s the latest edition in the often frosty relationship between the
presidential rivals. It was pretty warm for about an hour on election
night.

MATTHEWS: Well, this next story should surprise no one. The 112th
Congress is on track to be the least productive since the 1940s. With just
weeks left, the Congress has passed 196 bills into law, many of them
ceremonial pieces of legislation like the naming of courthouses.

Since the 1940s, the least productive Congress was the 104th. That was
back in the mid-`90s which passed 333 laws into law.

So, even with the deal, if there is one in the fiscal, the current congress
would need to pass more than 130 bills by next month to avoid the dubious
distinction of being the worst. Anyway, the least productive. Anyway,
that`s highly unlikely.

We`ll be right back.

(COMMERCIAL BREAK)

MATTHEWS: We`re back.

They may not be friends but today, for an hour, Mitt Romney and Barack
Obama had lunch together, meeting in the Oval Office and dining over turkey
chili and southwestern grilled chicken salad -- two poultry dishes in one
meal in what`s become a custom in recent presidential history.

The White House says they spoke of America`s leadership, but also noted the
two men would keep contact should they be able to work together again.
Well, perhaps a sign of things to come, maybe.

The relationship between presidents and the men they beat is a tricky one.
Sometimes, it develops into a warm friendship and sometimes not so much.

"Boston Globe" political reporter Matt Viser is here. He was at the White
House today reporting on that lunch. And also with me is presidential
historian Douglas Brinkley, my pal, whose most recent book is, great book,
"Cronkite."

Let me go right now and start with Matt and the reporting here.

We knew this was coming. The president said he wanted to do it. And there
is a tradition of burying the hatchet.

MATT VISER, BOSTON GLOBE: Yes.

MATTHEWS: What else got done? Did that get done? Did they bury the
hatchet?

VISER: Well, it was a symbolic moment that seems mostly symbolic. I mean,
there doesn`t appear to be much substance that`s come out of this meeting.
But you did have Romney sort of driving up in this black SUV. There`s
inauguration --

MATTHEWS: He didn`t drive it, though.

VISER: No, he didn`t drive. He was in the passenger side. But all alone,
stepping out of the car, nobody to open the door for him.

MATTHEWS: How democratic.

VISER: Yes, right.

Nobody opened the door for him. The inauguration stage is being built in
the background.

VISER: No Secret Service for Romney. In fact, I think he had to provide
his name and date of birth and Social Security --

MATTHEWS: No. They wouldn`t let him do that.

VISER: Yes. Just like anybody else.

MATTHEWS: Are they sweethearts? Little gate Nazis.

Anyway, I want you to look at this. Here it is. Post of election press
conference, the president offered up a possibility of working together with
former Governor Mitt Romney. Let`s listen to him.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: There may be ideas that he
has with respect to jobs and growth that can help middle class families
that I want to hear. So, you know, I`m not -- I`m not either prejudging
what he`s interested in doing, nor am I suggesting I`ve got some specific
assignment. But what I want to do is get ideas from him and see if -- see
if there`s some ways that we can potentially work together.

(END VIDEO CLIP)

MATTHEWS: Doug Brinkley, what do you make of this? Is this a beginning of
a great relationship like in "Casa Blanca" in the end or what?

DOUGLAS BRINKLEY, PRESIDENTIAL HISTORIAN: I don`t think so. I`m not sure
there`s a big assignment coming for Mitt Romney. You know, there are times
when presidents feel compelled after they beat somebody to get them in the
game.

I mean, FDR did that with Wendell Willkie in 1940. World War II was
coming. We`re all in this together.

FDR also brought in Frank Knox, a Republican, as secretary of Navy. And
Henry Stimson, a Republican, as secretary of war.

You`ve got moments, you know, Richard Nixon offered Hubert Humphrey the
olive branch of an ambassador of the U.N. But by and large, these don`t
work that well, unless it was an ex-president. If Mitt Romney had been the
ex-president, there is something called an exclusive president`s club, and
then there would be a role.

But I don`t see a blue ribbon commission of Mitt Romney heading right now
and I don`t see, you know, Romney teaming up with Dukakis and doing a kind
of report that`s going to matter. McGovern and Bob Dole both lost and they
got (INAUDIBLE) working as a tandem team. But they`re also both World War
II vets who had a lot of love and respect on Capitol Hill.

MATTHEWS: Yes. Well, the interesting thing is there have been
relationships that didn`t get too functional but Carter got along with
Jerry Ford very well. They became good friends. And, of course, George
W.`s father, George senior, Bush, became good friends with Bill Clinton.
He calls him a son, practically. So, this does work occasionally.

VISER: You can`t imagine that happening, though, with Romney and Obama. I
mean, just -- you know --

MATTHEWS: Well, we saw them in the debate and they don`t like each other.

VISER: They don`t like each other. It seems to be a personal animosity
towards each other. They don`t seem to respect one another.

MATTHEWS: Why do people -- you covered this campaign. This is not
partisan. It`s just an observation.

Why does everybody who runs against Romney hate him? I mean, McCain picks
Sarah Palin. He hated him so much (INAUDIBLE) as his running mate. The
rest of them, they just walk off those debate platforms and hate the guy.

VISER: I think it`s the issue of a core and having a political core and
consistent belief.

VISER: And Obama has his legal background, likes to have a legal argument
that fits together and Romney`s ideology doesn`t do that. So I think
there`s not that respect.

MATTHEWS: Do they believe he`s not really a member of the club, Doug,
because he doesn`t have a political philosophy. People like to say they
live or die on what they believe. That`s why they`re in public life. Not
just to be celebrities but to carry out a motive.

Do they believe he lacks one and that`s why he can`t get along with other
politicians who often seem to have a motive?

BRINKLEY: Bingo, Chris. I think that`s very true. And he doesn`t have a
job, either, Mitt Romney.

MATTHEWS: Well, you don`t need a job if you`re worth a quarter billion.

BRINKLEY: No. But, you know, John McCain still had his Senate seat. And
John Kerry still is in the Senate.

MATTHEWS: Yes.

BRINKLEY: So, they`re still players in Washington. And you`re looking at
Mitt Romney, he didn`t carry New Hampshire, Massachusetts, California, or
his home state, and there is no such thing as a Romney republic anymore.
They`re dwindling tribe.

So, he doesn`t have any power. So he`s coming today, Obama looked good
because he was showing reaching out, the winner sticking out his hand and
it shows a spirit of bipartisanship he`s trying to create throughout all of
this gridlock.

MATTHEWS: Matt, are they still stunned? I mean, I have to tell you, I
watch this stuff from 7:00 in the morning until I get to about midnight.
I`m constantly trying to figure this thing out.

I thought the election was much more pro-Obama than the results that I
expected. He won a very solid victory, a very solid mandate. Are they
still stunned by that?

VISER: Yes. In some respects, they are, and they`re still trying to
grapple sort of what happened and how their expectations got so high and
how --

MATTHEWS: I mean, Stu Stevens might think tonight, we`re trying to figure
out. What are they all trying to do? They`re still going to the tea
leaves? What happened here?

VISER: I think there is a bit of that. And Romney himself, you know, the
data guy, you now, it`s like going through the numbers trying to figure out
like what happened and what went wrong and win. And I think they`ll be
doing that for a while. You know, I mean, I don`t think it`s something
that`s fading for Romney. I mean, I think he still thinks about this an
awful lot.

MATTHEWS: Doug Brinkley, it`s an honor to have you on as always, sir.
Doug Brinkley, the author of that great book on Cronkite, which everybody
pays attention to the media, over the last -- over the lifetime of many of
us, should watch. It`s really good history of recent American history
going all the way back to World War II. It`s a great book.

Anyway, we`ll be right back. Doug Brinkley, thank you. Matt Viser of "The
Globe" -- the great "Boston Globe".

You`re watching HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Let me finish tonight with that lunch that they had at the White
House today. I`m absolutely convinced that politics should have its
limits. You fight over policy. You fight over confidence and ethics and
you try your best to keep the other side honest, smart and doing its job.
And when you can, you try to take that job away from the other side and try
doing it better yourself. And that`s the end of it.

It`s not about hating people. It`s not about refusing to cooperate in the
interest of the country.

Personally, I wish Romney had left things the way he had on election night.
He gave a great, even noble concession speech, said all of the right
things, didn`t blame it on his running mate or his campaign staff. He
praised them all. And he took the hit personally. It was class.

He then had to go mess it all up by saying the president won by making
gifts to the people who voted for him. Anyway, it won`t bother me a bit if
Romney did -- Obama did find a use for Romney, a role he could play for the
country. He did a good job in the Olympics. He does have talent in that
area, putting organizations in fighting shape, just as Obama has a proven
strength in community organizing, a fact on vivid display in the election,
especially on Election Day itself.

Harry Truman did it for Herbert Hoover. Maybe this president could do it
for Mitt Romney. Give him a job he can do well. It would set just the
right tone for the second term. And that`s what I care about.

We ain`t going to get anything done until the two parties try to find some
common ground out there. And that`s going to be the story of the next
coming weeks. Can they or can`t they?

That`s HARDBALL for now. Thanks for being with us.

"POLITICS NATION" with Al Sharpton starts right now.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY
BE UPDATED.
END

Copyright 2012 CQ-Roll Call, Inc. All materials herein are protected by
United States copyright law and may not be reproduced, distributed,
transmitted, displayed, published or broadcast without the prior written
permission of CQ-Roll Call. You may not alter or remove any trademark,
copyright or other notice from copies of the content.>